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Tax Season - Again?
As tax season begins, many small business owners feel the anxiety that comes along with this time of year. Entrepreneurs who file paper returns run the risk of errors, miscalculations or neglecting to claim all the credits and deductions available to them. A paid preparer may not even know all of the credits available to a business owner, especially some of the new credits such as the small business health care tax credit. The solution for some business owners is to hire an accountant to prepare their taxes, but with the current state of the economy, this is not an option for many.
Business tax software applications can provide the freedom of paper filing, while providing the advice and guidance of a paid preparer. While each business tax software program offers different benefits, there are some features which are standard. These include:
- Guided Filing – The program takes you step-by-step through the tax forms by using a series of questions.
- Audit Check - The tax software will show any items which may trigger an audit by the IRS.
- Deduction Review - The software will show common deductions that may apply to a business, this also includes industry specific deductions.
- Importing – Import W-2 and 1099 forms from many companies and investments. Also import last years tax information.
- Free efile – All of these programs include at least one free federal efile.
- Maximum Refund Pledge – All of these tax service programs include a guarantee that will refund the cost of the program or service if another tax preparation company can get a larger refund or a lower tax bill within a specified amount of time.
- Accuracy Guarantee – All of these tax services offer to pay any fees, penalties and interest levied by the IRS which were caused by errors in their software’s calculations.
- Satisfaction Guarantee – All of these tax service applications offer a money back guarantee if you are not satisfied with their service. This is only valid before you file or print your tax return.
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The TurboTax Home and Business Edition is for sole proprietors, consultants, and single member LLCs. The price for the downloadable business tax software application is $99.95. Features include:
- Create W-2 and 1099 Forms for employees.
- Allows a user to file their business and personal taxes together.
TurboTax Business is made for Corporations, Partnerships and LLCs. The price for the downloadable software is $129.95 for federal taxes only. Notable features include:
- Electronic Filing of K-1 forms with the IRS to show the distribution of net profits among shareholders and partners.
- Create Unlimited W-2, 1099-MISC, 1099-INT and 1099-DIV.
- Handle multiple businesses.
- Covers real estate property activities.
With TurboTax Business, you will need to purchase a TurboTax software application for individuals to complete your personal tax return.
TurboTax includes up to 5 Federal efile returns and some state returns are supported. You are able to print unlimited federal returns which is a plus if you own multiple businesses.
Although there is an extensive amount of information in their FAQs section, videos, tips and 24/7 Support with chat, in order to get one-on-one live support there is an additional charge.
With both versions you receive a downloadable audit support center with step by step guidance in case you are audited by the IRS. This is a downloadable program with no personal support. You are offered the opportunity to purchase Audit Defense services which includes representation by a trained tax professional in the case of an audit.
TurboTax is perfect for the business owners who have multiple businesses or need to prepare multiple returns, are comfortable preparing their own taxes and need little in the way of live support.
Continue on to the next page for more business tax software options.
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Deciding which business tax software application is best for your partnership or corporation isn't easy. It depends on how many businesses you own and the amount of support you need during tax preparation.
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H & R Block
H & R Block is one of the world's largest tax service providers. H & R Block At Home is their tax preparations software application.
H & R Block At Home Premium is for sole proprietors, consultants and people who own rental property. The price for the downloadable business tax software application is $64.95 and includes:
H& R Block Premium and Business is best for corporations, partnerships, LLCs, estates, trusts, and non-profits. The price for the downloadable software is $79.95 and includes:
- Payroll and employer forms including the W-2, 1099-MISC, 1099-INT and 1099-DIV and K-1.
- Although they include 5 personal federal e-files and 1 personal state download and unlimited business state programs. One Live tax advice session
H & R Block At Home includes importing of last years tax return from H & R Block at Home, Quicken and Turbo Tax. It also includes unlimited preparation and printing of federal returns.
H & R Block At Home includes Audit Support, advice from an H & R Block Enrolled Agent, as well as correspondence management and audit representation in the case of an IRS audit.
Sole proprietors can elect to purchase the H & R Block Best of Both Program which gives the unlimited support of a tax professional via email or phone for $79.95.
H & R Block does not have electronic filing of the K-1 forms.
After the first live support session, there is a charge for additional support.
H &R Block At Home is perfect for the business owner who has multiple businesses or needs to prepare multiple returns, and wants to have access to live support.
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Tax Act is one of the most affordable business tax software solutions. Because of its reduced pricing, it offers less support than some of the other tax services.
TaxACT 2010 Ultimate Bundle is for sole proprietors. The downloadable business tax software application costs $21.95. TaxAct has separate programs for Partnerships, C Corporations and S Corporations. Each costs $39.95 and can be used to file 1 federal return or $54.95 when combined with personal taxes in the Home and Business Edition.
- The 1065 Edition – Prepare and efile one federal Partnership return.
- The 1120 Edition - Prepare and efile one federal C Corporation return.
- The 1120S Edition - Prepare and efile one federal S Corporations return.
All TaxAct products include:
- One federal and state personal tax return.
- Up to 4 additional federal returns can be efiled for $7.95 each.
- Additional state returns can be printed for $14.95 each.
- Import date from your previous years returns or can import basic info from a precious years PDF tax return from Turbo Tax, H & R Block at Home.
- Unlimited free email support.
There is an Audit Assistance information page on the web site but no assistance if you are audited.
TaxAct is for the budget conscious entrepreneur who is comfortable with tax preparation. Any savings with TaxAct is lost for entrepreneurs with multiple businesses.
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As a sole proprietor business you have many choices in business tax software applications. Knowing what services you need to file your business and personal taxes, as well as how much support you need is important.
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eSmart Tax is an online tax service of Liberty Tax Services .The eSmart Tax Premium tax software is for sole proprietor businesses, and it's quite affordable compared to some of the other options. This is an online-only business tax software application which costs $24.95 for federal returns. State tax returns cost $9.95 each.
- MVP Edition offers federal and state filing for $34.95.
- 2 live chat sessions are included.
- Expert tax advice is available for $19.95 per session.
- CPA Audit Assistance provides CPA support throughout the audit process for eSmart Tax service users.
eSmart Tax does not provide business tax services for Partnerships and Corporations.
eSmart Tax is for the sole-proprietor who doesn’t require extensive support but wants to have live support if needed.
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Taxbrain has over 35 years experience in tax preparation, e-file and tax related services. They offer many services, not available with the other business tax software applications. Taxbrain 1040 Premium is for sole-proprietors and rental owners. This is an online-only application and costs $69.95 for a federal return and $29.95 for state.
- Complete and file prior year’s federal tax returns.
- Free live chat, phone support and secure email.
- Smart Coverage Audit Defense is available for a cost of $34.95 this includes professional assistances and payments up to $4,000 for federal and state tax assessments.
- Bound copies of tax returns can be purchased for $19.95.
- Taxbrain also offers a military discount of 20 percent
Taxbrain does not provide business tax services for Partnerships and Corporations.
Taxbrain is perfect for the sole-proprietor who wants support during tax preparation. For business owners that need to file returns for prior years, this is the only online business tax software application that has this service.
All prices listed are current as of January 4, 2010.